New Delhi, July 6 (IANS) The Union Budget maintained the governments stance of fiscal prudence and continued focus on infrastructure creation.
The budget, presented on Friday, has provided impetus to the banking sector with recapitalization of PSU banks to the tune of Rs 700 billion which was higher than expectations and also some short term measures to mitigate the stress on NBFCs.
While there were positives for the financial services sector, the budget is unlikely to provide short term boost to accelerate the GDP growth as the budget continues to stick to long-term strategic objectives.
Reliance Securities in its assessment said: "Certain measures like tax on buyback, incremental taxation on super rich and proposals to bring down promoter holding will have varied impact."
While the revenue targets are aggressive and curtailing expenditure will be a challenge but fiscal deficit is likely to remain manageable non tax revenues have been raised.
The key takeaways from the Union Budget 2019 are as follows:
Impetus on financial services and infrastructure creation: The re capitalisation of Rs 700 billion significantly higher than expectations which will help the PSU banking sector to increase participation and it is a significant long-term positive. Also significant measures of additional interest rate rebate for affordable housing is another positive. Infrastructure sector has continued to see decent growth with focus on roads. Housing for all is another key focus area for the government with significant increase in targets. Both these will be benefit the cement companies. Infrastructure companies focused on road projects will continue to perform well.
No major announcements for consumer sector; ITC scrapes through: There were no major announcements in the Union Budget for stoking consumption growth after the benefits announced in the interim budget. Excise duty was brought back on cigarettes but it is insignificant at less than 0.2 per cent of current tax incidence and manageable for the company. Increase in import on gold is a marginal negative for Titan but the company should be able to manage the impact. Automobile sector saw reduction in taxes on electric vehicles from 12.5 per cent to 5 per cent which is a long-term positive.
About Gopi
Gopi Adusumilli is a Programmer. He is the editor of SocialNews.XYZ and President of AGK Fire Inc.
He enjoys designing websites, developing mobile applications and publishing news articles on current events from various authenticated news sources.
When it comes to writing he likes to write about current world politics and Indian Movies. His future plans include developing SocialNews.XYZ into a News website that has no bias or judgment towards any.
He can be reached at gopi@socialnews.xyz